Drowning in debt

OF ALL the inappropriate and spurious transactions made by the west in developing countries over the past four decades, the £14 million investment in a chlorine factory at Fallujah, Iraq, in 1985 stands out as particularly ill-advised.

Built by Uhde Ltd, a British subsidiary of a German company, the project was underwritten by the UK government's export credit agency (ECA), which funds or insures British companies doing business in high-risk areas. In 2003, the US and UK governments cited the existence of this factory as a major reason to go to war against Saddam Hussein. It was, they said, key to Iraq's chemical weapons capability. Incredibly, in 1985 senior British government officials had acknowledged the "strong possibility" that Saddam would use the Fallujah factory to make mustard gas.

This was no flash in the pan. During the late 1980s, the British government underwrote sales to Iraq of fighter pilot training ...

To continue reading this article, subscribe to receive access to all of newscientist.com, including 20 years of archive content.

To continue reading this article, log in or subscribe to New Scientist